RBI survey sees agriculture growth slowing down

RBI survey sees agriculture growth slowing down
The Hindu Business Line, August 9, 2009, Page 3

Industrial growth may touch 4.3% this fiscal.

Our Bureau, Mumbai

Agricultural growth in the current fiscal could slow down to 2.5 per cent from 3 per cent, according to the latest Survey of Professional Forecasters by the Reserve Bank of India.

The survey, released on Friday, says that industrial growth could increase to 4.3 per cent from 4.1 per cent and services could grow to 8.3 per cent from 7.5 per cent in 2009-10.

GDP growth

The eighth round of the survey also revised upwards GDP growth to 6.5 per cent, from 5.7 per cent in the last survey.

The Central Government fiscal deficit is placed at 6.8 per cent of GDP in 2009-10, unchanged from the previous survey.

Indicating an upward movement in interest rates, the survey revised upwards both reverse repo and repo rates.

According to the survey, repo rate could be at 5 per cent (4.5 per cent in the last survey) while reverse repo rate could be at 3.5 per cent (3 per cent).

Corporate sector

Profit growth of the corporate sector has been revised downwards to 7.5 per cent from 9 per cent. The growth in profit is expected to improve to 15 per cent in 2010-11, the survey said.

The highest chance has been assigned to wholesale inflation being in the range of 4-4.9 per cent in 2009-10 and 5-5.9 per cent in 2010-11.

On a long-term basis, the forecast for real GDP growth for the next five years is 7.5 per cent, which is revised upwards from 7 per cent. For the next 10 years, the GDP is expected to grow at 8 per cent (7.5 per cent).